Venezuela: Collapse Accelerated Today (PHOTOS + VIDEO)

Venezuela: Collapse Accelerated Today (PHOTOS + VIDEO)

The collapse of Venezuela accelerated visibly today, as angry and hungry mobs roved the streets (throughout the country) for food and money.

Click on the link to watch a video of Bolivarian National Guard repression of today’s protests for food:disturbios-mp4

The Chavista regime got elected in 1998 to fix corruption, violence, poverty, inequality and political marginalization. All of those got much worse. Now the country is collapsing, and the regime ignores its own Constitution and refuses to give the people the recall referendum they want.

The poor, as always, suffer the most.

Every morning, Venezuela’s poor wake up not knowing what they will eat that day. They go in search of food, spending hours standing on long lines at markets hoping they will find some in time for dinner. Often they don’t. Entire families live off the mangos and avocados they pluck off the trees they find, or eat whatever dogs and cats they find.

Due to triple digit inflation, Venezuelans carry any money they do have in shopping bags and weigh it, rather than take the time to count it. The biggest banknote was the BS.F. 100, until it was banned earlier this week. In real terms (which is to say, the black market price of DolarToday), the (now-banned) Bs.F. 100 banknote equates to US$ 0.04.

A wad like this, was not enough to buy any food, but it would buy a two-liter bottle of Coca-Cola. Now it will buy nothing.

A wad of the banned Bs.F. 100 banknote.

Reports spread that Venezuela’s Central Bank was actually burning the banned money, to the horror of staff locked within. Whether the stories are true or not, they are symptomatic: the situation is crazy enough that they are believable, and their spread adds to the chaos and fear.

People ran on the banks, and often were not given cash. Stories spread the government would intervene and freeze the banks, which accelerated the runs.

We saw today how the lack of money is heavily exacerbating the lack of food.

In some places, there was no food in the stores or markets.

When stores did open, people couldn’t use the banned banknote. They can’t carry enough money to eat without the large banknote.

In other places, stores refused to open, afraid they would be looted. Merchants in El Callao, Bolivar, just threw money out the window, to keep from being killed as angry mobs stormed the gates and climbed the walls to enter through windows.

Venezuela’s Central Bank has said it will issue bigger banknotes. The first of the new notes, the Bs.F. 500 banknote, won’t arrive until January 2017 and it is already worthless. The government is literally just printing money, accelerating inflation. Inflation is well into the triple digits and is expected to hit over 1,600% when the new higher bank note arrives in January 2017. This currency, rather ironically named the Bolivar Fuerte (“Strong Bolivar”), replaced the previous currency (the Bolivar, with which I grew up) on 1 January 2008, at a rate of Bs. 1,000 = Bs.F. 1.

I had predicted regime collapse in Q1 2017; that prediction appears on target.

What will the international community do? Nothing, likely. There are so many countries in deep trouble, where do policymakers start? They will take the same attitude to South America they do to Africa: it’s a local problem — until such time as it becomes a terrorist hotbed. From a longer-term and global perspective, states are born, grow and die, like the people who comprise them.